Have you ever rejected a personal loan on the account of having low credit scores in your profile? Have you faced a situation in which the lender refused to give you a loan on the account of not submitting anything as collateral?
If the answer to such questions is yes, then you too belong to the 1 million people category in Canada who has faced rejection on the account of having bad credit scores and nothing to declare as security.
This post is here for you to get a substantial amount of knowledge as to how to get unsecured personal loans bad with credit instant decision in Canada. Over here, we will be reflecting the light on specialized personal loan offers for borrowers who already have negative or low scores in their credit profile and cannot produce anything as collateral. So, let’s get started.
See this is what happens normally
In general, whenever you seek for a personal loan to take care of unexpected expenditures, payday lenders ask you to go under the credit check process. This is the standard procedure to showcase a good credit score and be in a position to apply for insatnt approval loan.
The second common criteria you see are to give something as collateral. It could be your jewelry, vehicle or property papers, or anything like that.
Now, here with unsecured loans for bad credit holders, there is no such hassle to arrange anything as security and go under the cumbersome credit checking process. All you can get is instant approval on the personal loan with an amount that falls anywhere between $500 to $50,000 and sometimes more than that.
Now, in the next set of sections, we will be discussing more unsecured loans for bad credit with instant approval based on the following few points.
- Features of unsecured loan
- What is considered as bad credit?
- What’s the catch behind instant loans?
- Interest & charges on unsecured loans for bad credit
- Pros & cons
- Summing Up
Features of Unsecured Loan
Interest Charges: The charges related to the interest rate on a personal loan for bad credit holders falls anywhere between 6% to 47%. It depends on the credit score and provincial norms of the particular area in Canada. So, better to check the interest rate before applying for an unsecured loan.
Instant Approval: Unlike the secured loan, where you will go under the lengthy process of declaring something as security, fill in a massive range of paperwork, and face other formalities. All such things are not required to follow under unsecured loans for poor credit holders. Thus, you will get fast loan approval in a hassle-free manner.
No Collateral Requirement: Of course, you will not be asked to declare anything as collateral because it is of an unsecured category. So, you need not take the additional burden of arranging any asset as collateral.
How do I apply?
- Apply Online
- Let’s Talk Finance
- Upload Documents
- Sign Loan Offer
- Funds Transferred
What is considered as bad credit?
We have been saying this since the begging that it does not matter to have bad credit scores to apply for the offered loan. But what exactly is the credit score? And, how it has been termed as bad or good?
So, here’s the explanation for that.
A credit score is a number that reflects your borrowing capacity. In general, the credit ratings fall between 300 to 900 which reflects your potential to borrow a sum of cash or not. For a Canadian, a good credit score is always above 712. While the fair average falls between 660 and 712. On the other side, the bad or poor credit score you have must be between 300 to 574 respectively.
Even if, your credit profile showcases a score of 660, it is unlikely that you will be offered a loan. Despite that, the offered unsecured loan for bad credit holders is still offered no matter whatever credit score you have. And, get instant finance to deal with possible monetary emergencies.
What is the catch behind instant loans?
Now, let’s understand the instant approval factor behind bad credit unsecured loans. When you apply for a secured loan, you will go through the lengthy paperwork process, need to arrange security as collateral, and face other time-consuming formalities.
Here, there is nothing like that because this unsecured category of loan and you will get fast approval as compared to secured loan. The only drawback you see is the higher interest rate charged by lenders on the account of offering you a loan despite a bad credit score and nothing to declare as security.
Interest & Charges on Unsecured Loan for Bad Credit
The interest rate levied on unsecured loans is preferably on the higher side as compared to the secured category. It differs as per the borrowed money and the tenure. So, here, we will take you through an example figure of $5,000 borrowed for a period of 5 years with a credit scoring of 712 and see how the interest is being charged.
| Amount Borrowed | $5,000 |
| Interest Rate | 3.1% |
| Loan Term | 5 Years |
| Origination Fee | 5% |
| Total Upfront Fees | $250 |
| Total Interest | $403.95 |
| Total Repayment | $5,403.95 |
| Monthly Payment | $90.07 |
Pros & Cons
Let’s discuss the pros and cons of taking unsecured loans for bad credit holders and getting instant approval.
Pros |
Cons |
| Online Application: The simplest part of the loan is to apply online within a few minutes and that too leaves the very comfort of home. | High-Interest Charges: You typically have to pay a higher rate of interest as compared to the secured category of personal loans. |
| No Assets Required: You will not be asked to submit anything as collateral. | Difficult to Improve Credit Score: Sometimes, it would be difficult to improve your credit score while making equal monthly payments and handling other expenditures. |
| Flexible Payments: Repay the loan amount in easy equal monthly installments without facing any burden. | Damage to Further Credit Score: If fail to repay the loan or even skip even a single payment will have an adverse effect on your credit ratings. |
Summing Up
After having all the discussion above, if you are satisfied that you can apply for unsecured personal loans for bad credit with instant approval, and then get in touch with us. We help you overcome all the financial challenges by offering this loan and pave the way for seamless approval in no time.
Frequently Asked Questions
Is the interest rate higher on unsecured loans?
Yes, as compared to the secured category of loan offers in Canada, unsecured loan for bad credit has a bit higher interest charges.
What happens, if I default the loan installment?
Well, if that happens, then your credit score will go down and you further face hardships in the financial profile. This can further affect your future decisions in applying for a big loan.
How to rely on unsecured loan lenders?
Read the whole profile of the lender and make sure every single piece of information is available on the site before applying for the loan.
Payday Ninja offers a balanced approach to achieving your financial goals. Because your needs are met at the earliest. Well, our goal is to establish your trust. Which makes it easy for us to understand the immediate financial needs and long-term financial goals of the client. We find the best financial plan for you that supports your goals. Which provides the steps to achieve them. If you need money today but payday is far away… Come to Payday Ninja!